How Credit Cards Help Small Business Owners to Meet Their Daily Business Expenses?

Updated on: 04 Jan 2024 // 3 min read // Credit Cards
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Credit Cards are one of the most used financial products of all times and enjoys enormous popularity amongst customers from all walks of life. Such is the demand for Credit Cards that most of us either have a Credit Card or otherwise desperately want one. The demand for cards has risen significantly in the last few years due to the efforts of the Government to promote digital payments and due to the rise in popularity of e-commerce. Credit Cards are one of the most secure forms of online payments and offer you protection against any possible frauds if you act in time.

Credit Cards if not used judiciously promote unnecessary spending as well. But overall, of Credit Cards are used with proper planning offer a vast range of benefits to the holder.

How Do Credit Cards Work?

Credit Cards are a form of a pre-approved unsecured loan that works on the principle of revolving credit. Every card comes with a pre-approved limit, and you can use the card until that amount only. Your limit reduces every time you use the card and is replenished when you make the payment towards the bill. Every Credit Card has an interest-free period of up to 60 days, during which if you repay the bill in full, you need not pay any interest on the amount utilised. But if you do not make the entire payment due, you must bear the interest cost on the total amount due, right from the day of purchase, which can run up to 42% p.a.

Due to demands from various categories of customers, specialised Credit Cards are now being offered by the banks, and they provide the facility of applying online for a credit card. If you need a new Credit Card, you just need to fill a simple form online, and the bank representatives will get in touch with you for further process. Under most circumstances, you will receive your new card within a few days.

How Can SME Owners Use Credit Cards to Pay for Daily Expenses?

Business credit cards are one of the most popular forms of specialised Credit Cards that are available today in the market. They enjoy great popularity amongst the business owners as they help them separate their business expenses and personal expenses efficiently. Following are some of the ways that Credit Cards help SME owners meet their daily expenses:

  • Utility Bills: Business Credit Cards can be used to make payment for utility bills such as electricity, water, and Most utility providers accept payment through Credit Card at their counters or on their payment portal. Attractive cashback offers and rewards points further add to the benefit of using a card for utility bill payment.
  • Payment of Taxes: You can use cards to make a payment towards statutory liabilities such as GST, ESI, PF, Property Tax, Sales Tax, VAT, and so on. All government departments accept tax payment through credit card on their portal.
  • Pay for Fuel: You can pay for business-related fuel bills through Credit Cards. It could be fuel required for company vehicles or fuel for the backup Business cards can be used to make payment at all fuel stations. By using special business Credit Cards for fuel, a lot of money can be saved through a waiver of surcharge and cashback.
  • Travel Expenses: Traveling is an inherent part of the business, and you or other employees need to travel regularly for client meetings by train or airplane. All travel websites accept payment through Credit Cards and offer specific discounts also. Specific business Credit Cards provide free lounge access at major international airports as well.
  • Entertainment Expenses: Every now and then, you need to take your customers or other colleagues out for dinner or drinks. By using individual business Credit Cards that offer benefits on dining out, you can not only conveniently pay for the expenses but also earn discounts and reward points.
  • Minimise Forex Requirements: If your work involves travelling to foreign countries on a regular basis, you can use an international business Credit Card to pay for the expenses. This will reduce the need to carry forex with you in cash form.

Using a business Credit Card not only provides you clarity regarding your business expenses but also enables you to claim tax deductions on such expenses that can help you save a lot of money. So, if you do not have one yet, then apply for a business credit card now to take control of your business expenses.